| The Directors are pleased to present their 30th Annual Report for the
financial year ended on 31st March, 2015.
FINANCIAL RESULTS:
Your Company's performance for the year ended on 31st March, 2015, is
summarized as under:
(Amt. in Rs.)
SR. PARTICULARS 2014-15 2013-14
NO.
1. Revenue from Operation 40,31,266 31,33,790
2. Other Income 30,202 1,98,557
3. Total Revenue (1 2) 40,61,468 33,32,347
4. Depreciation & Amortization Exp. 2,17,702 1,91,971
5. Other Expenses 40,33,146 15,19,829
6. Profit/(Loss) Before Tax (5,97,605) 12,33,932
7. Current Tax 11,141 1,07,693
8. Deferred Tax 4,21,788 (3,17,489)
9. Profit/(Loss) After Tax (PAT) (10,30,534) 11,65,607
STATE OF COMPANY'S AFFAIRS AND FUTURE OUTLOOK:
During the year under Report, your Company has recorded the total
Revenue from Operations of Rs. 40,31,266/- as compared to
Rs.31,33,790/- of previous financial year 2013-14 showing an
approximate rise of about 28%. However, due to increasing inflation,
unfavorable market conditions and writing off of Bad Debts, the Company
has incurred loss of Rs.5,97,605/- as compared to Net Profit of
Rs.11,65,607/- of previous year. However, the management assures that
the Company will leave no effort unturned to recover the loss in the
impending phase and improve the profitability of the Company.
DECLARATION OF DIVIDEND & TRANSFER OF AMOUNT TO RESERVES:
Due to loss, your Board of Directors does not recommend declaration of
dividend. Moreover, no amount is being transferred to Reserves during
the financial year 2014-15
SHARE CAPITAL:
The paid up Equity Share Capital as on March 31, 2015 was Rs. 4 crores.
During the year under review, the Company has not issued any shares or
any convertible instruments.
EXTRACT OF ANNUAL RETURN:
Pursuant to Section 134 (3) (a) of Companies Act, 2013, Form MGT 9 i.e.
the extract of Annual Return for the Financial Year 2014-15 is enclosed
with this report.
BOARD MEETINGS AND INDEPENDENT DIRECTOR'S MEETING:
The Board of Directors of the Company respectively met Five times on
28/05/2014, 02/08/2014, 31/10/2014, 31/01/2015 and 31/03/2015 during
the financial year 2014-15.
Further, the Independent Directors meeting was held on 25th March, 2015
to review the performance of non-independent directors and the Board as
a whole; review the performance of the Chairperson of the Company,
taking into account the views of executive directors and non-executive
directors and assess the quality, quantity and timeliness of flow of
information between the Company management and the Board that is
necessary for the Board to effectively and reasonably perform their
duties.
BOARD'S RESPONSIBILITY STATEMENT:
Pursuant to the provisions of Section 134 (5) of the Companies Act,
2013, the Directors based on the information and representations
received from the operating management confirm that:
a) in the preparation of the annual accounts, the applicable accounting
standards had been followed and there are no material departures from
the same;
b) the directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the company at the end of the financial year and of the profit and
loss of the company for that period;
c) the directors have taken proper and sufficient care to the best of
their knowledge and ability for the maintenance of adequate accounting
records in accordance with the provisions of this Act for safeguarding
the assets of the company and for preventing and detecting fraud and
other irregularities;
d) the directors have prepared the annual accounts on a going concern
basis; and
e) the directors have laid down internal financial controls to be
followed by the company and that such internal financial controls are
adequate and are operating effectively.
f) the directors had devised proper systems to ensure compliance with
the provisions of all applicable laws and such systems were adequate
and operating effectively.
DECLARATION (OF INDEPENDENCE) BY INDEPENDENT DIRECTORS:
The Company has received declarations from each Independent Director
under section 149 (7) of the Companies Act, 2013 that he/ she meets the
criteria of independence laid down in Section 149 (6) of the Companies
Act, 2013 and Clause 49 of the Listing Agreement.
The Company has the practice to take the declaration of independence
from all Independent Directors on his/ her appointment/ re-appointment
and also in first meeting of the Board of Directors every year. All
these Directors are abiding to intimate to the Board about any change
in their status of independence in the very next board meeting after
such change.
COMPANY'S POLICY ON DIRECTORS APPOINTMENT, NOMINATION, REMUNERATION AND
FORMAL EVALUATION:
Pursuant to provisions of Section 178 (1) of the Companies Act, 2013,
the Board has, on the recommendation of the Nomination & Remuneration
Committee framed a policy for selection, nomination, appointment and
Remuneration of Directors suitably containing the criteria determining
qualifications, positive attributes and independence of a Director.
Moreover, in terms of Clause 49 of the Listing Agreement, the Board has
carried out annual performance evaluation of its own performance, the
directors individually as well the evaluation of the working of its
Audit, Nomination & Remuneration and Shareholders Grievance committee.
STATUTORY AUDITOR AND AUDITORS' REPORT:
M/s. SADP & CO., Chartered Accountants, Rajkot, Statutory Auditors of
the Company, hold office till the conclusion of the ensuing Annual
General Meeting and are eligible for re- appointment. They have
confirmed their eligibility to the effect that their re-appointment, if
made, would be within the prescribed limits under the Act and that they
are not disqualified for re-appointment.
The Auditors' Report does not contain any qualification, reservation or
adverse remark AND the Notes on financial statements referred to in the
Auditors' Report are self-explanatory and do not require any further
comments thereon.
SECRETARIAL AUDITOR AND SECRETARIAL AUDIT REPORT:
The Board has appointed Nayna Paramalji Chopra, Practicing Company
Secretary, to conduct Secretarial Audit for the financial year 2014-15.
The Secretarial Audit Report for the financial year ended March 31,
2015 is annexed herewith. The Secretarial Audit Report does not contain
any qualification, reservation or adverse remark.
PARTICULARS OF LOAN, GUARANTEES AND INVESTMENTS MADE:
During the year under report, the Company has not granted any loan or
provided any guarantee or made any investment exceeding the limits as
specified in Section 186 (2) of the Companies Act, 2013. Hence no
approval from the shareholders in this regard was required.
PARTICULARS OF CONTRACTS/ARRANGEMENTS WITH RELATED PARTIES:
The Company has not entered into any contract or arrangement with
related party which is not at arms' length requiring approval of
shareholders in the general meeting as required under section 188 of
the Companies Act, 2013. The Audit Committee reviews all the
transactions with related party on quarterly basis and recommends the
same to the Board for their approval. Your Directors draw attention of
the members to Note no. 24 to financial statements which set out
related party disclosures.
CORPORATE SOCIAL RESPONSIBILITY (CSR):
Pursuant to provisions of Section 135 of the Companies Act, 2013 read
with the Companies (Corporate Social Responsibility Policy) Rules,
2014, every company with a net worth of Rs. 500 Crores or more OR an
annual turnover of Rs.1000 Crores or more OR with a net profit of Rs. 5
Crores or more is required to constitute a CSR Committee. At present,
the Company is not required to constitute a CSR Committee in this
regards as none of the above referred limits have been triggered.
BOARD OF DIRECTORS:
In terms of Section 152 (6) of the Companies Act, 2013 read with
Companies (Appointment and Qualification of Directors) Rules, 2014, Mr.
Hitesh Bagdai, Managing Director (DIN: 00575732) and Mr. Bhavdeep Vala,
Director (DIN: 00153775) retires by rotation and being eligible, has
offered himself for re- appointment. The Board recommends the same for
your approval.
Mr. Kantilal Khakhar (DIN: 01957569), Mr. Ketan Dhulesiya (DIN:
02252208) and Mr. Janish Ajmera (DIN: 06708217) are the Independent
Directors of the Company.
In terms of provisions of Section 149 (10) read with Clause 49 of the
Listing Agreement, all three independent directors have been
reappointed with amended terms in the 29th Annual General Meeting of
the Company held on 30th September, 2014.
BOARD COMMITTEES :
AUDIT COMMITTEE: The Company is having an adequate Audit Committee
comprising of following Directors:
Sr.
No. Name & DIN of the
Director Status Category
1 Mr. Kantilal Khakhar Chairman of Audit Non- Executive and
(DIN:01957569) Committee Independent
Director
2 Mr. Ketan Dhulesia Member Non- Executive and
(DIN: 02252208) Independent
Director
3 Mr. Bhavdeep Vala Member Executive Director
(DIN: 00153775)
During the year under report, all the recommendations of the Audit
Committee were duly considered. Detailed terms of reference of Audit
Committee are provided in Corporate Governance Report.
NOMINATION AND REMUNERATION COMMITTEE: The Company is having an
adequate Nomination and Remuneration Committee comprising of following
Directors:
Name & DIN of the
Sr. Director
No. Status Category
1 Mr. Kantilal Khakhar Chairman of
Nomination Non- Executive and
(DIN:01957569) & Remuneration Independent Director
Committee
2 Mr. Ketan Dhulesia Member Non- Executive and
(DIN: 02252208) Independent Director
3 Mr. Bhavdeep Vala Member Executive Director
(DIN: 00153775)
Detailed terms of reference of Nomination and Committee are provided in
Corporate Governance Report.
SHAREHOLDERS GRIEVANCE COMMITTEE: The Company is having a Shareholder
Grievance Committee comprising of following Directors:
Name & DIN of the
Sr. Director
No. Status Category
1 Mr. Ketan Dhulesia Chairman of
Shareholder Non - Executive and
(DIN:02252208) Grievance
Committee Independent Director
2 Mr. Kantilal Khakhar Member Non- Executive and
(DIN: 01957569) Independent Director
3 Mr. Bhavdeep Vala Member Executive Director
(DIN: 00153775)
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO:
The provisions of Section 134(3) (m) of the Companies Act, 2013, and
the rules made there under relating to conservation of energy,
technology absorption do not apply to your Company as it is not a
manufacturing company. However, your Company has been increasingly
using information technology in its operations and promotes
conservation of resources. During the year under review, there was no
foreign earning or expenditure in the Company.
PARTICULARS OF EMPLOYEES:
There are no employees in the Company drawing remuneration of more than
Rs. 5 Lacs per month or 60 Lacs per annum, as prescribed in Rule 5 (2)
of the Companies (Appointment and Remuneration of Managerial Personnel)
Rules, 2014.
CORPORATE GOVERNANCE:
The Company believes that the Corporate Governance is all about
effective management of relationship among constituents of the system,
i.e. shareholders, management, employees, customers, vendors,
regulatory and the society at large. The Company has strong belief that
this relationship can only be built and strengthen through corporate
fairness, transparency, and accountability. The Securities and Exchange
Board of India (SEBI), Reserve Bank of India (RBI), National Foundation
for Corporate Governance (NFCG), Institute of Company Secretaries of
India (ICSI) and other such regulatory bodies and organizations are
continuously making stringent efforts to strengthen Corporate
Governance framework in the country.
Accordingly, a detailed Report on Corporate Governance as well as the
Certificate from M/s. SADP & Co, Chartered Accountants, and the
Statutory Auditors of the Company are annexed to this Report of Board
of Directors.
RISK MANAGEMENT:
The Company has framework for managing its risk. It has led down detail
procedure to inform Board member about the Risk assessment and
Minimization Procedure. The Company has made the policy in this regard
and the same is reviewed periodically to ensure the executive
management control risk through means of proper framework.
SUBSIDIARIES, JOINT VENTURE OR ASSOCIATE COMPANIES:
As at 31st March, 201 5, the Company doesn't have any Subsidiary, Joint
Venture or Associate Companies.
INTERNAL FINANCIAL CONTROLS
The Company has adequate internal financial controls with reference to
financial statements. During the year under report, no reportable
material weakness was observed.
PARTICULARS OF LOAN, GUARANTEES AND INVESTMENTS MADE:
During the year under report, the Company has not granted any loan or
provided any guarantee or made any investment exceeding the limits as
specified in Section 186 (2) of the Companies Act, 201 3. Hence no
approval from the shareholders in this regard was required.
VIGIL MECHANISM:
Pursuant to the provisions of Section 177(9) & (10) of the Companies
Act, 2013, a Vigil Mechanism for directors and employees to report
genuine concerns has been established. The Vigil Mechanism Policy has
been uploaded on the website of the Company at www.rajathfinance.com
OTHER DISCLOSURES:
- Your Company has not invited/ accepted any Fixed Deposits under the
provisions of Section 73 of the Companies Act, 201 3 and the Rules made
there under.
- No significant or material orders were passed by the Regulators or
Courts or Tribunals which impact the going concern status and Company's
operations in future.
- During the year under review, there were no cases filed pursuant to
the Sexual Harassment of Women at Workplace (Prevention, Prohibition
and Redressal) Act, 2013.
- No material changes and commitments have occurred after the close of
the year till the date of this Report, which affect the financial
position of the Company.
- The Company is not required to get its cost records audited for the
financial year 2014-15.
INDUSTRY STRUCTURE, DEVELOPMENT AND FUTURE OUTLOOK:
NBFCs, which historically have been very reliant on bank borrowings,
have now started to diversify their resource raising profile to reduce
cost of funds. In the current environment financing through bonds,
debentures and commercial papers (CPs) are much cheaper as compared to
bank borrowings. The highlights of the reforms introduced by Government
of India in their budget for the coming fiscal for the financial sector
are as following:
- Inclusion of NBFCs, having an asset size of Rs 500 crore and above,
under the SARFAESI Act and new bankruptcy code will provide a boost to
recovery efforts and help rein in asset quality problems over the long
run.
- Setting up of autonomous "Bank Board Bureau" marks the initial move
towars formalizing a holding company structure for public sector banks.
This will improve governance, optimize capital contribution by
government, and provide greater functional autonomy.
- The new Micro Units Development Refinance Agency (MUDRA) Bank for
refinancing of microfinance institutions will support micro credit.
The revised regulatory framework released in November, 2014 by the RBI
focuses on strengthening the structural profile of the NBFC sector.
These changes have to be implemented in a phased manner by Reserved
Bank of India, by March 31, 201 8.
SEGMENTS:
Rajath Finance Limited, does not have multiple segments, and hence,
comments are not required.
PERFORMANCE:
During the year under Report, the Company has recorded total revenue of
Rs. 40,61,468/- and major part of revenue is generated through Interest
Income. Further, due to unfavorable conditions prevailing in the
market, the Company has incurred a Net Loss of Rs.10,34,534/-. Your
directors assure to recover the losses as early as possible.
INTERNAL AUDIT SYSTEM
The Company has implemented proper and adequate systems of internal
control to ensure that all assets are safeguarded and protected against
loss from any unauthorized use or disposition and all transactions are
authorized, recorded and reported correctly. The System ensures
appropriate information flow to facilitate effective monitoring. The
internal audit system also ensures formation and implementation of
corporate policies for financial reporting, accounting, and information
security.
CAUTIONARY STATEMENTS
All statements made in Management and Discussion Analysis have been
made in good faith. Many unforeseen factors may come into play and
affect the actual results, which could be different from what the
Management envisages in terms of performance and outlook. Market data,
industry information etc. contained in this Report have been based on
information gathered from various published and unpublished reports and
their accuracy, reliability, and completeness cannot be assured.
Factors such as economic conditions affecting demand/supply and priced
conditions in domestic & international markets in which the Company
operates, and changes in Government regulations, tax laws, other
statues and other incidental factors, may affect the final results and
performance of the Company.
ACKNOWLEDGEMENT:
Your directors put on record their whole hearted gratitude to bankers,
employees of the Company for their sincere efforts for the Company.
By Order of the Board of Directors
Date : 30/05/2015 For, RAJATH FINANCE LIMITED,
Place : Rajkot
Sd/- Sd/-
(HITESH BAGDAI) (BHAVDEEP VALA)
MANAGING DIRECTOR DIRECTOR
(DIN: 00575732) (DIN: 00153775) |